So one of my 2012 goals, both personally and professionally, is to do a better job at accounting. This is funny if you know me in real life where I run a small business, have an MBA and spend most of my days bookkeeping. I think this is why I slack off after hours, I am burnt out!
To kick this goal off, I have made a few simple changes that will help me get in better control of my finances.
Paypal: Paypal has sent notices to several of colleagues who have business accounts and receive money as "personal." Sending money this way avoids Paypal's fees and I think they have caught on that some people use this type of transaction even if they sell goods. I do a lot of personal shopping with my Paypal but usually have a balance because many of my students use it to pay for classes. For this reason, I have opened a 2nd personal account. Paypal let's you have one business and none personal account and I am going to take advantage of this. They won't let you duplicate funding sources but I have a business checking account and a credit card dedicated to dance.
In doing my end of year reporting, I saw how much I paid in Paypal Fees last year. When I first started taking Paypal for classes, I chose to eat the fee so the cost was the same for students no matter how they paid. Now that I have seen how much that cost me I decided to add the fee into the cost of paying online. I know many other teaching and businesses that do this.
Outright.com: Since ,until now, I had been mixing personal with business on Paypal and my credit cards; doing my end of year finances were kind of tedious if I didn't sort things out pretty regularly. I was using Quickbooks Simple Start (I use Quickbooks Pro at work so it made sense to me). QB Simple is easy but is not really more than an electronic check register that will total things for you. There is also only a check register and credit card register so adding in Paypal was difficult. All this prompted me to look for something better. Enter Outright.com. I found a review and recommendation from PCWorld, and then checked a few other reputable sources.
Here's why I like it. It can import transactions from most major banks, credit cards, and Paypal. It will actually import sales info from sources such as Etsy as well. If you have ever used Mint (something else I recommend), it is very similar. One of the best features is that not only can you add custom categories, one of the preset categories is Personal Expense. Once you mark something as a Personal Expense (or Personal Income) it gets removed from all the reports. It also separates out the Paypal Fees, which is how I came to the conclusion above.
I have also set up a Square account so I can take Credit Card payments in class. I am going to add on the 2.75% that Square charges into my rate.
I feel really positive about all of this. My life seems easier already :)